WashWire Daily Brief: Health-Law Coverage Gap

Welcome to the new WashWire Daily Brief newsletter, the Journal’s morning rundown of the biggest news stories and exclusive features from Washington on politics, policy, financial regulation, defense and more.

Here’s a scary Monday morning statistic: Nearly five million people aged 18 to 64 currently get no financial help to buy health coverage due to a mismatch of state and federal rules. Although the 2010 health law intended to expand Medicaid to people earning as much as four times the poverty line, states don’t have to expand their Medicaid coverage. Republicans in 24 states have declined the expansion, citing burdensome costs and a rise in people dependent on the government.

The result? Lower-income people in half the states get no help, but better-off workers elsewhere can buy insurance with taxpayer-funded subsidies. Among those cut off from coverage is 27-year-old Tanisha Fields, who earned about $7,000 last year working at a cleaning service. That’s too little to qualify for federal help to buy coverage, but too much to get coverage under Alabama’s Medicaid program.

Some Republican-led states like Utah and Florida are revisiting their expansion decisions as complaints pile up, and Obama administration officials are touring some states to urge legislators to change their minds. Patients aren’t the only ones affected. Hospitals are seeing their revenues go down, as they face deep cuts in federal reimbursement for treating uninsured patients. Christopher Weaver reports on the front page of today’s Journal. http://on.wsj.com/1iE7VMa

–Rebecca Ballhaus

JERRY SEIB: THE REPUBLICAN DEBT-CEILING CONUNDRUM

Associated Press

With Republicans taking the blame for an inept legislature and taking credit when politics run smoothly, they are now faced with a tricky decision. Washington Bureau Chief Jerry Seib explains the circumstances surrounding the decision among Republicans over whether to cleanly raise the debt ceiling or ask for spending cuts instead. VIDEO:http://on.wsj.com/1eN3HRC

PETER NICHOLAS’S BONUS EARLY HITA good bet is that Hillary Clinton will enter the 2016 presidential race, and immediately become the prohibitive favorite. But what if Mrs. Clinton opts to sit it out, and doesn’t say so until late this year? That would leave the party in quite a hole. Donors aren’t apt to write checks to a Maryland Gov. Martin O’Malley or a former Montana Gov. Brian Schweitzer so long as a Clinton candidacy is on the horizon, one Democratic campaign aide says. And without money, it’s tough for second-tier hopefuls to build the campaign machinery needed to be successful in the general election.Read Peter Nicholas’s full post in Washington Wire. http://on.wsj.com/1iQkTFW

WSJ STORIES YOU SHOULDN’T MISS

LABOR MARKET: The percentage of American workers who voluntarily left their jobs—the “quit rate”—hit 1.8% in November, the highest in the recovery and up from a low of 1.2% in September 2009. That’s a good sign of the labor market’s health, economists say, because it indicates that people are more optimistic about their prospects. What’s more, research shows most of the wage growth workers see over their careers comes from changing jobs. Neil Shah reports. http://on.wsj.com/1iDkszt

VA ACCOUNTABILITY: Congress is cracking down on the Department of Veterans Affairs over its response to what lawmakers say are management and medical errors, just as a new generation of injured troops floods VA facilities. Incidents like a patient’s death after an altercation with a nursing assistant and a deadly outbreak of Legionnaire’s disease reflect a lack of accountability at the 1,700 VA hospitals, clinics and other facilities, lawmakers say. Michael M. Phillips and Ben Kesling report. http://on.wsj.com/1iDKEtI

GAY RIGHTS: Same-sex couples will have the same legal rights in federal matters as other married couples on issues of bankruptcy, prison visits and testimony, under new policies the Justice Department will issue today. The move follows a Supreme Court decision last year that invalidated a key part of the Defense of Marriage Act, prompting a review of federal rules and regulations. Conservative groups, including the National Organization for Marriage, criticized the decision as undermining states’ authority. Devlin Barrett reports. http://on.wsj.com/1iDL2Zf

IRAN DEAL: Iran agreed to seven measures Sunday that aim to shine more light on its nuclear activities. The agreement with the International Atomic Energy Agency is a first step in addressing Western suspicions that Iran has worked on a military nuclear program. These negotiations are on a separate track from Iran’s talks with six world powers that seek to reach a deal restricting the country’s future nuclear activities in exchange for international sanctions relief. Laurence Norman reports. http://on.wsj.com/1h0oiFe

–Compiled by Rebecca Ballhaus

On the Editorial pages, First Lady Michelle Obama praises construction companies’ pledge to hire 100,000 veterans over the next five years. She writes that hiring veterans isn’t just the patriotic thing to do; it’s a smart move for business. http://on.wsj.com/1iQqmwx

WHAT WE’RE READING AROUND THE WEB

A previously unknown archive of papers and documents of the late Diane Blair, a close friend of Hillary Clinton, include a trove of personal notes about conversations with the former First Lady, “revealing her to be a loyal friend, devoted mother, and a cutthroat strategist who relished revenge against her adversaries and complained in private that nobody in the White House was ‘tough and mean enough.’” Alana Goodman of the Washington Free Beacon reports. http://bit.ly/1iQmQlN

Democratic party liberals, uncertain where Hillary Clinton stands on some of the economic issues that now represent the left’s top priorities, are watching closely how she handles issues such as raising the minimum wage and protecting or raising Social Security benefits. The Associated Press’s Ken Thomas reports. http://bit.ly/1iQmZFV

With the clock running toward the point at month’s end when the federal government will hit its statutory debt ceiling, there have been communications between the White House and the office of House Speaker John Boehner, but no real negotiations, writes Politco’s Jake Sherman. http://politi.co/1iQn6kG

Albert Hunt writes that he was wrong in his original doubts about the skill set of White House chief of staff Denis McDonough, saying “he has emerged as a high-energy, efficient and politically skillful manager who is changing some of the insularity for which the Obama White House is known.” http://nyti.ms/1iQnfVe

Richard Reeves of Brookings offers a set of basic facts to illuminate the debate on income inequality, including data showing that households of all income levels have enjoyed increased income between 1979 and 2007, but that there were bigger increases in income at the top of the income distribution over the same period, driving up income inequality. http://bit.ly/1iQnos2

MINOR MILESTONEOf the 344 companies reporting earnings so far, 72% have reported earnings-per-share above estimates. But just under 53% of those companies have seen shares rise following their reports, below the five-year average of 58%, according to FactSet. http://on.wsj.com/1iQoxQi

About Washington Wire

Washington Wire is one of the oldest standing features in American journalism. Since the Wire launched on Sept. 20, 1940, the Journal has offered readers an informal look at the capital. Now online, the Wire provides a succession of glimpses at what’s happening behind hot stories and warnings of what to watch for in the days ahead. The Wire is led by Reid J. Epstein, with contributions from the rest of the bureau. Washington Wire now also includes Think Tank, our home for outside analysis from policy and political thinkers.